NPD Predicts Prepared Retail Foods Will Outpace Restaurant Growth

CHICAGO -- Prepared foods from supermarkets, drugstores and other retail outlets will continue to steal visits from restaurants, according a new forecast from the NPD Group (Port Washington, NY) that may have implications for purveyors of single-serve convenience foods in workplaces.

NPD's A Look into the Future of Foodservice 2022 suggests that instances of prepared food purchased at retailers for consumption at home will increase by 10% over the next decade, compared with a 4% increase forecast for restaurant traffic.

While consumers of all age groups make use of prepared foods from retail outlets, different groups purchase them for different reasons NPD has found.

For example, adults 35 years and older are more likely than 18-to 34-year-olds to use prepared foods from retail to meet their at-home supper needs. Lunch-at-home interests are also met by retailers of prepared foods, especially for seniors (65+). Consumers 18 to 24 are more inclined than others to make purchases from retail outlets to satisfy their desires for afternoon or evening snacks.

In terms of prepared foods purchased, younger adults are more likely to purchase pizza, hot dogs, and burgers to eat at home. Consumers 50 years of age and older are interested in purchasing both fried and non-fried chicken, while younger adults are more inclined to order non-fried chicken.

The home meal replacement entrees purchased most frequently from retail outlets include chicken, pizza and macaroni and cheese. Sandwiches are also popular take-home items.

Fueled by the growth in the number of Baby Boomers entering their senior years, the larger share of home meal replacement purchases from retailers will be attributable to the 65-and-older age group over the next 10 years, NPD predicts. Prepared foods retailers are also expected to benefit from increased visits from those in their 30s.

"Capturing visits from direct competition, like prepared foods retailers, has been the primary source for a restaurant operator's growth over the past 10 years and this will continue to be the case," said Bonnie Riggs, NPD restaurant industry analyst. "Efforts to pull consumers out of their homes and back into restaurants will require touting the benefits of eating out versus staying at home and cooking or eating meals offered by home meal replacement retailers."

NPD Group launched its first retail tracking program in 1984, and now follows more than a dozen industries around the world. It is online at npd.com.